Terms and Features Why Make the Change

Feature	Primary Credit	Secondary Credit
To access the Discount Window, eligible depository institutions first must execute the necessary documentation and pledge collateral to the Federal Reserve. See www.frbdiscountwindow.org for details.
General Characteristics	For generally safe and sound institutions Subject to minimal administration; normally, borrowers will be asked, "how much for how long?"	For depository institutions that do not qualify for primary credit Subject to higher level of administration; the level will vary with the nature of specific requests
Rate	Initially FOMC’s fed funds target plus 100 basis points	Initially Primary Credit plus 50 basis points
Term	Backup short-term liquidity facility (generally overnight)	Generally short-term FDICIA lending restrictions may apply
Use	No restrictions	To facilitate a timely return to normal market funding sources or the orderly resolution of a troubled institution
Collateral	Secured to Fed’s satisfaction	Secured to Fed’s satisfaction
Rationing	Interest rate	Interest rate and administration